Clark v. Clark, 57 A.3d 1, NJ Appellate Div. 2012
The decision to end a marriage is a hard one and often time people stay in a bad marriage for years. All the while, they accumulate grievances, that to them, seem like very big mountains but are, in the eyes of a court, little molehills. Finally, when they file for divorce, they often seek monetary reimbursement for perceived bad behavior that they were “forced” to endure.
Often times, courts do not want to hear about these grievances. However, in rare cases, if a court determines that the fault rises to the level of “egregious fault”, then a court will take this conduct into consideration when it divides the assets and debts accumulated during the marriage or will use it to determine the amount and duration of alimony. One of the best cases I have seen that describes egregious fault as it pertains to financial shenanigans is the matter of Clark v. Clark.
In this case, husband and wife were married for twenty-eight years. They were the parents of four children and were equal shareholders in DeFranc, Inc., which owned and operated Grayrock Pharmacy. The Plaintiff, the husband, was the founder and pharmacist of Grayrock. The Defendant, the wife was the bookkeeper.
During the marriage, the parties frequently fought over money. The husband felt that the wife was spending too much money, but the wife disagreed that her spending was a problem. The marriage really began to deteriorate about four years prior to the filing of the divorce action. During that time, the wife decided that she would begin “taking care of [her]self financially.”. Taking care of herself included secreting approximately $400,000 of the business’s cash and hiding the loot, among other places, in the parties’ basement.
The trial court found that the wife did take the money and ordered that she pay back to the husband approximately half of the amount taken. In addition, over the husband’s objections, the court order the husband to pay $600.00 per month in alimony to the wife.
The husband appealed. The husband argued that the taking of $400,000 from the family business over a four year period rose to the level of egregious fault and therefore the trial court should have considered “egregious fault” and denied the wife alimony.
The Appellate Court agreed with the husband that the wife’s conduct may very well be egregious. The Appellate Court found that wife’s long-term scheme to embezzle the cash receipts from Grayrock “smacked of criminality” and demonstrated “a willful and serious violation of societal norms.” The Appellate Court vacated the $600.00 alimony award and sent the case back to the trial court to determine whether wife’s conduct was egregious and, if so, whether it should have an impact on the alimony award.
The finding of egregious fault is very rare and is made on a case-by-case basis. Indeed, in this case, the Appellate Court was extremely cautious and merely found that embezzling $400,000 of marital income may rise to the level of egregious fault. As the injured spouse, you must weigh very carefully whether you want to pursue a claim based on egregious fault knowing that very few spouses prevail.